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Federal Reserve Bank-How does the Fed control the money supply? Be sure to explain how they can expand or restrict the money supply.

Federal Reserve Bank Monetary policy is largely determined by the Federal Reserve Bank (Fed) in the United States. For this discussion, let’s cordially debate the necessity of the Fed. For your initial post address the following: How does the Fed control the money supply? Be sure to explain how they can expand or restrict the […]

Explain the principle known as monetary policy ineffectiveness and discuss Lucas’ argument as to why it arises in an economy in which agents have rational expectations.

A. Explain the principle known as monetary policy ineffectiveness and discuss Lucas’ argument as to why it arises in an economy in which agents have rational expectations. [70 marks] B. Lucas argues that while unexpected changes in the money supply can have real effects, such effects get quantitatively smaller the more volatile is the conduct […]

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